General Information

Regional Policy

EUROPEAN COMMISSION 14/07/2004EN

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Cohesion Policy 2007 - 2013

The Commission’s proposal for new regulations

14 July 2004

http://europa.eu.int/comm/regional_policy

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General Regulation on the ERDF, the ESF and the Cohesion Fund

4ERDF Regulation4ESF Regulation4Cohesion Fund Regulation

One Commission Regulation

Information, Publicity, Financial control and Financial corrections

Council by unanimity, assent of EP

ERDF, ESF: Codecision;Cohesion Fund: Consultation

Proposed new legal architecture

New: General Regulation applies to the Cohesion Fund; a new Rural Development Fund now outside Cohesion Policy; one Commission regulation instead of five for specific aspects; eligibility rules simplified and incorporated in the General and Funds' regulations.

4Regulation establishing a European grouping of cross-border cooperation (EGCC)

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Background

Between 2001 and 2003: large debate on future priorities and management with Member States, regions and other players organised by the Commission

February 2004: Commission adopts the Communication on Financial Perspectives 2007-13 allocating Euro 336 billion to Cohesion Policy and the 3rd Cohesion Report laying down the framework for the policy's reform

May 2004: Third Cohesion Forum in Brussels with over 1,400 stakeholders largely supporting the Commission approach

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Growth: Cohesion instruments increase public and private investment in beneficiary regions

Convergence: Funds contribute to increasing GDP in regions lagging behind

Employment: Creation of jobs and maximising potential of human resources

Increase physical and human capital

Better regional and local governance

Financial stability over 7 years

Cohesion Policy impact

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Objectivestrengthen economic and social cohesion and reduceregional disparities

Instrumentsthree Objectives and fourCommunity Initiatives; 49.5% of the population in EU25 live in areas covered byObjective 1 or Objective 2

Financial resourcesabout Euro 233 bnrepresenting one third of the EU's total budget or 0.45% of the EU‘s GDP

Cohesion Policy between 2000 and 2006

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Convergence objective 78.5%including a special programme for outermost regions (EUR 264 bn.)

Programmes andInstruments

Eligibility Priorities Allocations

European territorial co-operation objective 3.94%(EUR 13.2 bn.)

Regional competitiveness and employment objective 17.2%(EUR 57.9 bn.)

Cohesion Policy2007-2013

3 Objectives

Budget: € 336.1 bn(0.41% of EU-GDP)

Art. 3-7 and 15-18 Gen.Reg. and

Fin. Perspect.

Regional and nationalprogrammes ERDFESF

Cohesion Fund

Regions with a GDP/head<75% of average EU25

Statistical effect:Regions with a GDP/head

<75% of EU15 and >75% in EU25

Member StatesGNI/head <90% EU25 average

•innovation;•environment/risk prevention; •accessibility; •infrastructure; •human ressources; •administrative capacity

•transport (TENs); •sustainable transport; •environment; •renewable energy

67.34%= 177.8 Mrd. EUR

8.38%= 22.14 Mrd. EUR

23.86%= 62.99 Mrd. EUR

Regional programmes (ERDF) and national programmes(ESF)

Member States suggest a list of

regions(NUTS I or II)

"Phasing-in"Regions covered by objec-

tive 1 beween 2000-06 and not covered by theconvergence objective

•Innovation•environment/risk prevention

•accessibility•European employmentstrategy

83.44%= 48.31 Mrd. EUR

16.56%= 9.58 Mrd. EUR

Cross-border andtransnational

programmes andnetworking (ERDF)

Border regions andgreater regions of

transnational co-operation

•innovation;•environment/risk prevention; •accessibility•culture, education

35.61% cross-border12.12% ENI 47.73% transnat. 4.54% f. networks

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48.31

177.80

22.14

62.99

9.58

Convergence

Regional competitivenessand employment

European territorial cooperation

Regions below 75% GDP

Statistically affected regions

Cohesion Fund

Special programme foroutermost regions: 1.1

Regions outsideconvergence

Phasing-infor regions in Obj. 1

between 2000-06

Cross-bordercooperation: 4.7

Transnationalcooperation: 6.3

External borders: 1.6

Networks: 0.6

Cohesion Policy 2007-2013Split by objectives in billion Euro (total: EUR 336.1 billion)

Art. 15-18 Gen.Reg. and Fin. Perspect.

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The reform’s guiding principles

Concentration: a more strategic approach reinforcing the Union's priorities; geographic - about 80% of funding to less developed regions, thematic - focus on Lisbon and Gothenburg agendas

Simplification: number of regulations reduced; less objectives - less funds; programming; no zoning any more, mono-fund programmes; a more flexible financial management; proportionality regarding control, evaluation and monitoring; eligibility of expenses

Decentralisation: stronger role for the regions and local players

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Concentration: a more strategic approach

Adoption of overall strategic document for cohesion policy by the Council with an opinion of the European Parliament before the new programming period: Defining clear priorities for Member States and regions

Clear link between cohesion policy and Lisbon & Gothenburg strategies , increase consistency with Broad Economic Policy Guidelines and the European Employment Strategy

Annual report by the Commission to EU institutions to assess Member States’ progress and examination by the Council

Art. 23-30 Gen.Reg.

Regional Policy


Guyane (F)

GuadeloupeMartinique Réunion

Canarias (E)

Açores (P)

Madeira

gRe oi GISge oi GISR

below 75% in EU25

statististical effect below 75% in EU15 above in EU25

"naturally" above 75% because of growth

other regions

Index EU 25= 100

Source: Eurostat

Geographical concentrationRegions below or close to 75% threshold

Art. 5+6 Gen.Reg.

GDP/head average1999-2000-2001

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Financial resources: more concentration on less developed regions

Convergence objective: 78.5% (EUR 264 bn.) of the total allocation for Member States and regions at NUTS level II, allocation by eligible population, regional and national prosperity and unemployment

Regional competitiveness and employment: 17.2% (EUR 57.9 bn.) of the total allocation for regions at NUTS level I or II, allocation by eligible population, regional prosperity, unemployment, employment rate, education level of those employed, and population density

European territorial co-operation: 3.94% (EUR 13.2 bn.) of the total allocation for Member States, using eligible population

Art. 16-18 Gen.Reg.

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Simplification

General: 3 instead of 7 objectives, 3 instead of 5 funds, mono-fund programmes, no zoning outside “Convergence” objective

Programming: 2 steps instead of 3

Additionality only to be verified for convergence objective

Financial management at priority axis level, allows greater flexibility for programme adaptations

Eligibility of expenses defined according to national rules (with a few exceptions)

Control system : proportional if Community cofinancingbelow 33% and EUR 250 million of total costs

Art. 8-13 and 73 Gen.Reg.

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Decentralisation

A stronger role for the regions: shared management between the European, national, regional, urban and local level

all regions to benefit from Cohesion policy

Urban issues: subdelegation to to urban authorities possible

Art. 12 and 58 1a)Gen. Reg.

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Maintaining key policy principles (1)

Complementarity, consistency and compliance: intervention are complementing national, regional, local and Union’s priorities, are coherent with strategic framework and conform with the Treaty

multi-annual programming ensures continuity

Partnership: concerns the strategic and operational aspects of the policy and implies the involvement of regional, urban, local and other authorities, economic and social partners and civil society, environmental and equal opportunities organisations

Art. 8-10 Gen.Reg.

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Maintenance of key policy principles (2)

Subsidiarity and proportionality: interventions respect the institutional system of the Member State and management is proportional to Community contribution in the areas of control, evaluation and monitoring

Shared management: Member States and Commission share responsibility for budget control

Additionality: Structural Funds may not substitute national public expenditure (applies to ”Convergence”)

Equal opportunities for men and women: applies to all steps in funds managementArt. 11 - 14 Gen.Reg. Art. 11-14 Gen. Reg.

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Financial resources: reward of quality and more flexibility

Quality and performance reserve: 3% of the allocations for the “Convergence” and “Regional competitiveness and employment” objective; Council to decide in 2011 the attribution by quality criteria

National reserve for unexpected: 1% of the “Convergence” and 3% “Regional competitiveness and employment” objective to be allocated for unexpected economic and social restructuring

Art. 35 and 36 Gen.Reg. Art. 20, 48, 49

Gen.Reg.

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Community‘s strategic guidelines on cohesionproposed by the Commission,

adpoted by the Council, assent by theEuropean Parliament

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National strategic reference frameworkproposed by the Member State in applying the

partnership principle; reflects on the Union‘s orientations, lays down a national strategy and its programming;

finally decided by the Commission

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Operational Programmesone programme by fund and Member State

or region, description of priorities, management and financial sources; proposed by Member State or region;

finally decided by the Commission

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Programme management and project selectionby Member States and regions; “shared management“

principle = concertation with the Commission44

Strategic guidelines, programming and follow-up

55Strategic follow-up and annual debate

by the European Council in Spring, based on annualreport of the Commission and Member States

Art. 16-21 and 28 Gen.Reg.

Art. 23-29 Gen.Reg.

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Shared management and control

Art. 42 - 46and 52 - 54 Gen.Reg.

General: Member States have to set up effective systems for management, certification and control of expenditure

Operational Programmes: managing authority to implement the programme, certifying authority to certify expenditure, and control authority to carry out audits in accordance with international standards

Commission: responsibility remains for the implementation of the general budget implying own audits

Proportionality: If Community level of cofinancingbelow 33% or EUR 250 million, some provisions do not apply

Art. 12, 57-59, 69-73Gen.Reg.

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Modulation of Community contribution rates

Participation rates vary with respect to economic, social and territorial problems and are calculated as share of to public expenses: 85% for the Cohesion Fund; outermost regions and

outlying Greek islands75% for the “Convergence” programmes

(exemption: 80% for member states with Cohesion Fund)50% for the “Regional competitiveness and employ-

ment” programmes75% for the “European territorial co-operation”

programmes

+10% for “inter-regional co-operation”+5% (60% maximum) for "regional competitiveness and

employment" programmes for areas with natural handicaps (islands, mountains, densely populated areas and regions with external borders before 30 A pril 2004)

Art. 51+52 Gen.Reg.

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Convergence and regional competitiveness (1)The European Regional Development Fund (ERDF) finances in theframework of the

“Convergence” objective: research and technological development, innovation and entrepreneurship; information society; environment; risk prevention; tourism; transport networks/TEN; energy networks and renewable energies; education and health investments; direct aids to SMEs

“Regional competitiveness and employment” objective:Innovation and the knowledge economy (RTD, technology transfer, innovation in SMEs)Environment and risk prevention (NATURA 2000 rehabilitation of contaminated land; promotion of energy efficiency qndrenewable energies)Access - outside urban areas - to transport and telecommunication services of general economic interest

Art. 4, 5 ERDF Reg.

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cross-border economic and social activitiesentrepreneurship and the development of SMEs, tourism, and culture; protection of the environment; better access to transport, information and communication networks and services, and water and energy systems; social and cultural infrastructures inparticular in the health and education sectors;

transnational cooperation, integrated territorial development: water and coastal management, accessibility, advanced communications and information technologies; maritime safety; risk prevention; R&TD and technological development networks etc.;

networking and exchange of experience among regional and local authorities: co-operation network programmes, studies, data collection, and the observation and analysis of development tendencies in the Union (studies, data collection, and analysis of Community development trends).

Art. 5 ERDF Reg.

European territorial co-operationThe European Regional Development Fund (ERDF) finances in theframework of

Art. 6 ERDF Reg

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Focus on employmentThe European Social Fund (ESF) finances in the framework of the

“Convergence” and “Regional competitiveness and employment” objective: Increasing adaptability of workers and enterprises; enhancing access to employment and participation in the labour market; reinforcing social inclusion of people at a disadvantage and combating discrimination; mobilising for reforms in the fields of employment and

inclusion (pacts, partnerships).

“Regional competitiveness and employment” objective: expanding and improving investment in human capital (education, training, post-graduate studies);strengthening institutional capacity and the efficiency of public administrations and other organisations (studies, training for

structural fund actors).

Art. 2 ESF Reg.Art. 3 ESF Reg.

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Focus on transport and environmental infrastructure : Cohesion Fund

Multi-annual programming: the Cohesion Fund will now be programmed together with the ERDF in Operational Programmes for transport and environment infrastructure

Projects to be co-funded: Transeuropean transport networks, Priority projects in the field of environment and sustainable development favorising rail, maritime, multi-modal and sustainable urban transport connections and energy efficiency and renewables

Conditional assistance: support depends on the Member State's public deficit management

Art. 2 - 3 CF Reg.Art. 3 Gen. Reg.

and Art. 5 CF Reg.

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European grouping for cross-border cooperation(EGCC)

Background: difficulties in managing cross-border,transnational and interregional programmes and projects because of diiferent legal and national lawsand procedures

approach: an institution with a legal personality basedon a voluntary 'convention' between Memeber Statesand/or regions carrying out cross-border, transnational and interregional programmes and projects based on Art. 159 para. 3 TEC

no financial responsibility for Community funds canbe delegated to the EGCC

Art. 1-3 EGCC Reg.

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Next steps

End 2005: Decision by Council and European Parliament

beginning of 2006: Council adopts Community' strategic guidelines on cohesion

2006: Preparation of programmes for period 2007-2013

1 Jan 2007: Implementation begins

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